What changed
This Master Circular consolidates all existing instructions on remittance facilities for NRIs, PIOs, and foreign nationals as of January 1, 2008, into a single document. It replaces earlier circulars and includes a sunset clause, standing withdrawn on July 1, 2008, when an updated version will be issued.
What it means for you
Banks must now refer to this single circular for remittance rules, simplifying compliance. The circular clarifies that current income remittance is freely allowed with CA certification, and asset repatriation for eligible foreign nationals of non-Indian origin is capped at USD 1 million per financial year, with exclusions for Nepal and Bhutan citizens. Banks need to ensure proper documentation and tax compliance for all remittances.
What you must do
- Update internal guidelines to reference this Master Circular for all NRI/PIO/foreign national remittance requests.
- Verify CA certification and tax payment proof for current income remittances, even for those without NRO accounts.
- For foreign nationals of non-Indian origin, enforce the USD 1 million per financial year cap on asset remittances only for eligible categories (retired from employment in India, inherited assets, or widow of Indian citizen) and collect required documents (acquisition proof, undertaking, CA certificate). Note that this facility is not available to citizens of Nepal and Bhutan.
- Ensure NRI/PIO definitions are correctly applied, excluding Bangladesh and Pakistan citizens from PIO status.
- Prepare for the sunset clause by planning to adopt the updated circular after July 1, 2008.
Who it affects
All Authorised Persons in Foreign Exchange (banks and dealers), Non-Resident Indians (NRIs), Persons of Indian Origin (PIOs), Foreign nationals with assets in India, Chartered Accountants certifying remittances
What is the maximum amount a foreign national of non-Indian origin can remit from asset sale in India?
An eligible foreign national of non-Indian origin (who has retired from employment in India, inherited assets from a person resident in India, or is a widow of an Indian citizen who was resident in India) can remit up to USD 1 million per financial year (April-March), subject to producing documentary evidence of acquisition/inheritance, an undertaking, and a CA certificate as per CBDT Circular No.10/2002. This facility is not available to citizens of Nepal and Bhutan.